Socially Responsible Investing (SRI) has grown rapidly at a steady pace over the last decade and currently accounts for nearly $30 trillion of the investable assets.
Funds with strategies that emphasize good governance (ESG) and socially responsible business practices are seeing regular inflows. Hedge funds, until recently, have not.
Bloomberg reports that nearly 30% of hedge funds are now using ESG factors to influence their investment decisions.
Typical hedge fund clients are long-term pension fund clients and they’re asking more and more questions about social issues like climate change, environmental impact, diversity and more. Hedge fund managers are now tasked with developing practices that meet those needs in an industry that typically focuses on more short-term and/or aggressive bets.
While many hedge fund managers themselves are unsure if there are benefits to ESG considerations, they’re listening to investor interest and making the necessary changes.
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